Co-founder of Budgit, Oluseun Onigbinde has disagreed with the Federal Government on its intention to borrow $29.9 billion to finance the nation’s infrastructure development from 2016 to 2019 from the World Bank, African Development Bank, Japan International Co-operation Agency (JICA), and Islamic Development Bank (IDB) China EximBank.
Onigbinde said that the intention of the government will quadruple the external debt in four years, bringing it to $42bn.
He explained in an infographics that was made available on his social media platform that there is a reason to be worried if government finally achieved his plan to borrow N2.2tn to finance the budget with another intention to borrow N2.7tn next year.
“If Buhari goes harder on this feat, he would double the national debt in three years. This is happening without revenues moving up at the same pace”
“The challenge with external debt is the currency risk. If foreign currency inflows stall ( as they currently do) due to oil price and production levels, there will be repayment crisis. I am worried at the size of the debt. Nigeria ratings were further downgraded in junk category recently due to high cost of debt servicing as a ratio of revenues”, he said.
He cited the example of how the country spent $12bn to exit the Paris club which could have done so well for the development of the country.
“What government must know is that every debt is a burden on future revenues. This is why this government opaque structure helps no one”, the budget analyst said.
Onigbinde complained that government has not been transparent enough in releasing details of 2016 budget performance report and capital projects that they released N753bn for.
“Why is government always afraid of enlightened citizens? Why don’t they get it that transparency is needed to build trust? Why can they just go rigorous work of really convincing people that this loan is really worth it with deep analysis”, he asked.
BudgIT is a civic startup that liberates budgets and public data from an inactive state into a more engaging format mostly through infographics and interactive application with the aim of improving civic discussion and institutional reform.